Formula 1 is riding a wave of popularity in the U.S., and its CEO is shopping around its success with potential media partners for a more lucrative U.S. media deal.
The racing league’s current deal with ESPN expires at the end of 2022. It was extended in 2019 to the tune of $5 million per year. Sports Business Journal reported the league, which is owned by Liberty Media, is seeking as much as $75 million a year for its next TV rights deal.
Formula 1 Group CEO Stefano Domenicali declined to specify which potential partners the league is speaking to, or how much the league is seeking, but he told CNBC he sees “great opportunity” in the negotiations and expects the next deal to “build on” the ESPN fees.
“We need to be respectful for the fact that ESPN did a great job for us to promote the business in that landscape,” he said from the inaugural Miami Grand Prix. “But the great opportunity we have is to make sure that the future offers we are discussing with the partners are well positioned in terms of content, in terms of opportunity for the fans to follow and of course in terms of fees. The future is very interesting for us.”
Formula 1 set a new viewership record last season when it averaged 934,000 viewers per race on ESPN channels and the ABC network — up 54% compared with F1′s 2020 races. F1′s 2021 viewership included an average 1.2 million viewers for the U.S. Grand Prix in Austin.
The growth shows no signs of slowing. ESPN said the season-opener Bahrain Grand Prix in March averaged 1.3 million viewers in the U.S. and peaked at 1.5 million viewers in the race’s final minutes.
The share price of Formula 1’s main tracking stock is up 34% over the past year and has doubled since 2017.
The sport’s recent surge in the U.S. is in large part powered by the Netflix docuseries “Drive to Survive.” Season 4 of the show, released in March, attracted its largest audience to date and broke into the weekly Top 10 in 56 countries, according to Formula 1 and Netflix. The parties announced Thursday the series has been confirmed for a fifth and sixth season.
Some have speculated Netflix could seek to buy the live F1 media rights, and mark its first foray into live sports. Domenicali declined to rule it out.
“Netflix has helped us a lot,” he said. “They did an incredible job. We did an incredible job together, because that’s something that you cannot do alone. I think that together we may have also some other things that we can do together to improve our accessibility in the American market.”
In 2023, F1 will host three U.S. races, with the addition of a race in Las Vegas in November and the U.S. Grand Prix in Austin in October. The first Miami Grand Prix runs this weekend.
While the sport has long been popular overseas, with a global audience averaging more than 80 million per race, it has lagged far behind NASCAR in the U.S., which averaged just under 3 million viewers per race last year.
“We are just at the beginning of this new journey,” Domenicali said. “The popularity of our sport has grown tremendously. It requires a lot of attention, to be sure that our narratives hit the tastes of the American fans.”